Trade Facilitation Agreement Meaning

Currently, the cost of international trade is about $2 trillion. [4] This is due to a large number of factors, including redundant customs procedures, marginal tariffs and unnecessary duplication. [4] The economic benefits of the Trade Facilitation Agreement are not yet fully perceptible and measured. However, estimates of the economic benefits arising from the agreement are widespread. Estimates range from about $68 billion to nearly $1 trillion a year. According to the OECD, the trade facilitation agreement has the potential to reduce trade costs by 14.1% for low-income countries, 15.1% for middle-income countries and 12.9% for high-middle-income countries. This would indicate a series of earnings of about 9 to 133 $US per year per person on the planet. These wide ranges indicate that some uncertainties still surround the trade agreement. [5] When referring to “trade facilitation”, policymakers refer to a series of specific measures that streamline and simplify the technical and legal procedures applicable to products entering or coming from a country in order to act at the international level. As such, trade facilitation covers the full range of border procedures, from the electronic exchange of data to the simplification and harmonisation of trade documents, including the possibility of challenging administrative decisions of border authorities.

Trade facilitation objectives have been introduced into the international agenda mainly due to four main factors[6]. The eleven TFIs adopt values from 0 to 2, with 2 being the best performance to achieve. The variables in the TFI dataset are encoded with 0, 1, or 2. These should not only reflect the regulatory framework in the countries concerned, but also, to the extent possible, address the status of implementation of various trade facilitation measures. The method opinion provides an overview of the structure of the indicators and describes the data collection process. Technical assistance for trade facilitation is provided by the WTO, WTO members and other intergovernmental organizations, including the World Bank, the World Customs Organization and the United Nations Conference on Trade and Development (UNCTAD). In July 2014, the WTO announced the establishment of the Trade Facilitation Facility that would help developing and least-developed countries implement the Trade Facilitation Agreement. The mechanism was established with the adoption of the Trade Facilitation Protocol on 27 November 2014. The meeting brought together LDCs and trade facilitation experts to reflect on the conditions needed to ensure the implementation and success of the agreement, including technical and capacity-building assistance.

You can learn more about trade facilitation in your country using our country comparison tool, where you can also compare the performance of different countries or groups of countries and visualize global progress in certain areas of trade facilitation. Our Policy Simulator tool in turn allows you to determine the key performance indicators of a selected country in a given indicator and simulate the impact of potential policy reforms on overall performance. The Trade Facilitation Policy Simulator allows you to quickly have an overview of the indicators and key indicators that feed into the overall performance of a selected country and compare the chosen country with other countries. . . .